When we enforce the law, we or a court may order the defendant to take action to correct the harm it caused consumers. This can include requiring the company or person to compensate (or pay back) its victims by providing consumer redress or a refund.
When the CFPB or a court orders a company to pay money to consumers harmed by their actions, the payments may be distributed directly by the company, through the Civil Penalty Fund, or a payments administrator.
A civil money penalty is a fine that the government can issue for certain violations of consumer protection laws. Whenever we collect a civil money penalty through an enforcement action, the money is deposited into our victims relief fund, called the Civil Penalty Fund. The Civil Penalty Fund can be used to pay eligible harmed consumers who are not expected to get full compensation directly from the person or company that broke the law. Since consumers can only obtain redress from the Civil Penalty Fund in cases where a civil money penalty is imposed, the CFPB may impose a nominal $1 civil money penalty.
The Consumer Financial Protection Bureau (CFPB) is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.
